Question 1

Why is the balance sheet a useful tool?

Accepted Answer

The balance sheet is a useful tool to ex

Question 2

What is George and Betty's net income?

Accepted Answer

A) $1,700 
B) $(600) 
C) $(500) 
D) $1,600 
E) Not enough information available to answer question 
A) $1,700 
B) $(600) 
C) $(500) 
D) $1,600 
E) Not enough information available to answer question

Question 3

The median household income in 2016 is

Accepted Answer

A) $56,516. 
B) $62,851. 
C) $67,751. 
D) $54,816. 
A) $56,516. 
B) $62,851. 
C) $67,751. 
D) $54,816.

Question 4

Patty has $9,000 in monetary assets,annual living expenses of $36,000,a $12,000 car loan balance,and $45,000 in equity in her house.What is her month's living expenses covered ratio?

Accepted Answer

A) 1.125 times 
B) 3.75 times 
C) 3.0 times 
D) There is not enough information to answer this question. 
A) 1.125 times 
B) 3.75 times 
C) 3.0 times 
D) There is not enough information to answer this question.

Question 5

Which of the following would be included on a personal income statement?

Accepted Answer

A) Your 401(k)balance 
B) Buying a flat-screen TV on credit 
C) Making a payment to your credit card company 
D) All of the above 
A) Your 401(k)balance 
B) Buying a flat-screen TV on credit 
C) Making a payment to your credit card company 
D) All of the above

Question 6

Assuming that they have no current bills other than those that are listed,what is their current ratio?

Accepted Answer

A) 0.79 times 
B) $5,000/$3,000 
C) 2 times 
D) Not enough information available 
A) 0.79 times 
B) $5,000/$3,000 
C) 2 times 
D) Not enough information available

Question 7

Suppose that Cathy's assets include an automobile worth $10,000 and a checking account with a $5,000 balance,while her liabilities include a student loan balance of $2,000 and a car loan balance of $8,000.What is her net worth?

Accepted Answer

A) $10,000 
B) $8,000 
C) $5,000 
D) $2,000 
A) $10,000 
B) $8,000 
C) $5,000 
D) $2,000

Question 8

A plan for controlling and forecasting your cash inflows and cash outflows is called a(n)

Accepted Answer

A) income statement. 
B) balance sheet. 
C) cash budget. 
D) statement of changes in financial position. 
E) none of the above. 
A) income statement. 
B) balance sheet. 
C) cash budget. 
D) statement of changes in financial position. 
E) none of the above.

Question 9

Using financial ratios helps you quickly compare and analyze the raw data found in your personal income statement and balance sheet.

Accepted Answer

A) True 
 B)False

Question 10

Kareem has $6,000 in monetary assets and $2,000 in current liabilities.What is his current ratio?

Accepted Answer

A) 2,000/6,000 
B) 0.334 times 
C) 6,000/2,000 
D) 3 times 
E) Both C and D are correct. 
A) 2,000/6,000 
B) 0.334 times 
C) 6,000/2,000 
D) 3 times 
E) Both C and D are correct.

Question 11

Your ________ is found by dividing monetary assets by current liabilities and is a good measure of liquidity.

Accepted Answer

A) debt ratio 
B) current ratio 
C) net worth 
D) net cash flows 
A) debt ratio 
B) current ratio 
C) net worth 
D) net cash flows

Question 12

The term "fair market value" refers to how the price of an asset has changed since its original purchase.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following items would not be included on a balance sheet?

Accepted Answer

A) Balances owed on your utility bills 
B) Balances owed on your credit card(s) 
C) Mortgage payment paid 
D) Automobile loan balance 
E) Student loan balance 
A) Balances owed on your utility bills 
B) Balances owed on your credit card(s) 
C) Mortgage payment paid 
D) Automobile loan balance 
E) Student loan balance

Question 14

Your net worth,or your general level of financial worth,is found by

Accepted Answer

A) subtracting your expenses from your income. 
B) dividing your monetary assets by your current liabilities. 
C) subtracting your liabilities from your assets. 
D) dividing monthly debt (less a mortgage payment)by monthly income. 
E) subtracting current liabilities from monetary assets. 
A) subtracting your expenses from your income. 
B) dividing your monetary assets by your current liabilities. 
C) subtracting your liabilities from your assets. 
D) dividing monthly debt (less a mortgage payment)by monthly income. 
E) subtracting current liabilities from monetary assets.

Question 15

According to the Keown book,the median net worth for American families in which the head of the household is less than 35 years old is below $10,000.

Accepted Answer

A) True 
 B)False

Question 16

A strong record-keeping system allows you to

Accepted Answer

A) track expenses. 
B) know exactly how much you're spending. 
C) know where you're spending your financial resources. 
D) all of the above. 
A) track expenses. 
B) know exactly how much you're spending. 
C) know where you're spending your financial resources. 
D) all of the above.

Question 17

Sarah has $15,000 in monetary assets,$48,000 in annual living expenses,a $20,000 balance on her car loan,and $60,000 of equity in her house.What is her month's living expenses covered ratio?

Accepted Answer

A) 1.125 times 
B) 3.75 times 
C) 3.0 times 
D) There is not enough information to answer this question. 
A) 1.125 times 
B) 3.75 times 
C) 3.0 times 
D) There is not enough information to answer this question.

Question 18

Jorge has a debt ratio of 37 percent and Jose has a ratio of 102 percent.They both have the same take-home pay every month.How can we describe their current financial situation?

Accepted Answer

A) Jorge is currently solvent. 
B) Jose is currently insolvent. 
C) Jorge probably has more money available to enjoy every month. 
D) Jose probably doesn't have much money available to enjoy every month. 
E) All of the above 
A) Jorge is currently solvent. 
B) Jose is currently insolvent. 
C) Jorge probably has more money available to enjoy every month. 
D) Jose probably doesn't have much money available to enjoy every month. 
E) All of the above

Question 19

Insolvency results from earning more than you spend.

Accepted Answer

A) True 
 B)False

Question 20

From the Keown book,you have learned that a budget

Accepted Answer

A) can be simple or sophisticated. 
B) is a process of setting spending goals for the upcoming month or year. 
C) is a plan for controlling cash inflows and outflows. 
D) includes both actual and estimated expenses. 
E) all of the above. 
A) can be simple or sophisticated. 
B) is a process of setting spending goals for the upcoming month or year. 
C) is a plan for controlling cash inflows and outflows. 
D) includes both actual and estimated expenses. 
E) all of the above.

Why is the balance sheet a useful tool?

What is George and Betty's net income?

The median household income in 2016 is

Patty has $9,000 in monetary assets,annual living expenses of $36,000,a $12,000 car loan balance,and $45,000 in equity in her house.What is her month's living expenses covered ratio?

Which of the following would be included on a personal income statement?

Assuming that they have no current bills other than those that are listed,what is their current ratio?

Suppose that Cathy's assets include an automobile worth $10,000 and a checking account with a $5,000 balance,while her liabilities include a student loan balance of $2,000 and a car loan balance of $8,000.What is her net worth?

A plan for controlling and forecasting your cash inflows and cash outflows is called a(n)

Using financial ratios helps you quickly compare and analyze the raw data found in your personal income statement and balance sheet.

Kareem has $6,000 in monetary assets and $2,000 in current liabilities.What is his current ratio?

Your ________ is found by dividing monetary assets by current liabilities and is a good measure of liquidity.

The term "fair market value" refers to how the price of an asset has changed since its original purchase.

Which of the following items would not be included on a balance sheet?

Your net worth,or your general level of financial worth,is found by

According to the Keown book,the median net worth for American families in which the head of the household is less than 35 years old is below $10,000.

A strong record-keeping system allows you to

Sarah has $15,000 in monetary assets,$48,000 in annual living expenses,a $20,000 balance on her car loan,and $60,000 of equity in her house.What is her month's living expenses covered ratio?

Jorge has a debt ratio of 37 percent and Jose has a ratio of 102 percent.They both have the same take-home pay every month.How can we describe their current financial situation?

Insolvency results from earning more than you spend.

From the Keown book,you have learned that a budget

The Financial Planning Process

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: the Role of Open Credit

Student and Consumer Loans: the Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: an Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Eventsfitting the Pieces Together

Filters

Exam 2: Measuring Your Financial Health and Making a Plan

Why is the balance sheet a useful tool?

What is George and Betty's net income?

The median household income in 2016 is

Patty has $9,000 in monetary assets,annual living expenses of $36,000,a $12,000 car loan balance,and $45,000 in equity in her house.What is her month's living expenses covered ratio?

Which of the following would be included on a personal income statement?

Assuming that they have no current bills other than those that are listed,what is their current ratio?

Suppose that Cathy's assets include an automobile worth $10,000 and a checking account with a $5,000 balance,while her liabilities include a student loan balance of $2,000 and a car loan balance of $8,000.What is her net worth?

A plan for controlling and forecasting your cash inflows and cash outflows is called a(n)

Using financial ratios helps you quickly compare and analyze the raw data found in your personal income statement and balance sheet.

Kareem has $6,000 in monetary assets and $2,000 in current liabilities.What is his current ratio?

Your ________ is found by dividing monetary assets by current liabilities and is a good measure of liquidity.

The term "fair market value" refers to how the price of an asset has changed since its original purchase.

Which of the following items would not be included on a balance sheet?

Your net worth,or your general level of financial worth,is found by

According to the Keown book,the median net worth for American families in which the head of the household is less than 35 years old is below $10,000.

A strong record-keeping system allows you to

Sarah has $15,000 in monetary assets,$48,000 in annual living expenses,a $20,000 balance on her car loan,and $60,000 of equity in her house.What is her month's living expenses covered ratio?

Jorge has a debt ratio of 37 percent and Jose has a ratio of 102 percent.They both have the same take-home pay every month.How can we describe their current financial situation?

Insolvency results from earning more than you spend.

From the Keown book,you have learned that a budget

The Financial Planning Process

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: the Role of Open Credit

Student and Consumer Loans: the Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: an Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Eventsfitting the Pieces Together

Filters